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United States Government Accountability Office:
GAO:
Report to Congressional Requesters:
August 2013:
VA Benefits:
Improvements Needed to Ensure Claimants Receive Appropriate
Representation:
GAO-13-643:
GAO Highlights:
Highlights of GAO-13-643, a report to congressional requesters.
Why GAO Did This Study:
Representatives accredited by VA serve a critical role in helping
veterans or their family members file claims for VA benefits. By law,
accredited individuals must demonstrate good moral character and
program knowledge and VA’s OGC is tasked to ensure they do so by
reviewing initial applications and monitoring ongoing requirements,
such as training.
GAO examined (1) the extent to which VA’s procedures adequately ensure
representatives meet program requirements, and (2) any obstacles that
may impede VA’s efforts to adequately implement its accreditation
process. GAO reviewed relevant federal laws, regulations and
procedures, and interviewed VA officials and organizations of
accredited representatives. GAO also reviewed a representative sample
of accreditation decisions made in 2012 as well as complaints received
by VA in 2012. GAO also conducted additional checks on a random but
small and non-representative sample of accredited individuals.
What GAO Found:
The Department of Veterans Affairs’ (VA) Office of General Counsel
(OGC) procedures do not sufficiently ensure that accredited
representatives have good character and knowledge. While GAO’s
analysis shows that VA follows its procedures for reviewing initial
accreditation applications, VA relies on limited self-reported
information to determine whether applicants have a criminal history or
their character could be called into question, which in turn leaves VA
vulnerable to accrediting individuals who may not provide responsible
assistance. For example, when GAO conducted additional checks on a non-
representative sample of accredited individuals, GAO found that some
individuals had histories of bankruptcies or liens, information which
could help develop a more complete picture of applicants’ character
and prompt further inquiry by VA into their background. VA’s
procedures also do not ensure that representatives have adequate
program knowledge. For example, VA’s initial training requirements are
minimal and VA does not consistently monitor whether representatives
meet additional continuing education requirements. As a result, some
accredited representatives may not have adequate program knowledge to
effectively assist clients with their claims. After being briefed on GAO
’s findings in May 2013, VA’s OGC announced plans to take additional
steps toward conducting background checks on applicants and auditing
ongoing character and training requirements.
VA efforts to administer accreditation are hindered by an inadequate
allocation of resources and unclear communication with claimants. For
example, OGC has only four staff dedicated to overseeing thousands of
accreditation applications each year, in addition to monitoring
approximately 20,000 accredited representatives. As a result, OGC has
not kept pace with pending accreditation applications, and has not
consistently monitored continuing requirements. OGC’s reliance on
manual data entry results in resource-intensive program
administration. For instance, OGC lacks information technology systems
and tools that would help it proactively and efficiently identify
representatives who are not meeting ongoing training requirements.
Moreover, VA does not clearly solicit feedback from claimants about
accredited representatives. For example, neither VA’s accreditation
web page nor information VA sends to claimants clearly communicates
their rights or how to report abuses. Absent such outreach, claimants
may not be aware that some representatives may be engaging in
prohibited practices. Lastly, VA’s current accreditation program does
not address some emerging threats to claimants. For instance, VA has
received complaints regarding unaccredited individuals inappropriately
charging claimants to apply for benefits. By law, only accredited
individuals can assist claimants. However, VA is not aware of the
extent these unaccredited individuals operate, and is limited in the
actions it can take to prevent them from assisting claimants.
What GAO Recommends:
To improve the integrity of accreditation, GAO recommends that VA
explore options for strengthening knowledge requirements and
addressing emerging threats, improve its outreach, and determine the
resources needed to adequately carry out accreditation. VA concurred
or concurred in principle with GAO’s recommendations and cautioned
that imposing additional requirements to address concerns with
representative knowledge or address emerging threats could have a
chilling effect on representation.
View [hyperlink, http://www.gao.gov/products/GAO-13-643]. For more
information, contact Daniel Bertoni at (202) 512-7215 or
bertonid@gao.gov.
[End of section]
Contents:
Letter:
Background:
VA's Procedures and Requirements Do Not Sufficiently Ensure That
Representatives Are Qualified:
Inadequate Resource Allocation and Unclear Communication with
Claimants Hinder Efforts to Administer Accreditation:
Conclusions:
Recommendations for Executive Action:
Agency Comments and Our Evaluation:
Appendix I: Objectives, Scope, and Methodology:
Appendix II: Comments from the Department of Veterans Affairs:
Appendix III: GAO Contact and Staff Acknowledgments:
Tables:
Table 1: Categories of Individuals Accredited by VA:
Table 2: Specific Initial and Ongoing Accreditation Requirements by
Type of Representative:
Table 3: Organizations Interviewed by GAO:
Figure:
Figure 1: Number and Percentage of Open Claims by Representation Type:
Abbreviations:
CLE: Continuing Legal Education:
OGC: Office of General Counsel:
VA: Department of Veterans Affairs:
VBA: Veterans Benefits Administration:
VSO: Veteran Service Organization:
[End of section]
GAO:
United States Government Accountability Office:
441 G St. N.W.
Washington, DC 20548:
August 1, 2013:
Congressional Requesters:
In 2012, veterans, their spouses, or survivors filed over a million
claims for various benefits with the Department of Veterans Affairs
(VA). In order to help these claimants navigate what can be a complex
and lengthy process, VA accredits individuals--called representatives--
to help ensure responsible and qualified representation is available
to prepare, present, and prosecute claims on the behalf of veterans.
[Footnote 1] Representatives who assist veterans and their families in
applying for benefits must have good moral character and be capable of
providing competent representation, and VA has responsibility for
making such determinations through its accreditation process. However,
we and others have found instances in which individuals that purport
to help veterans may actually be harming them. For example, in prior
work we identified instances where representatives charged excessive
fees for filing claims or failed to properly file claims, costing
veterans thousands of dollars in foregone benefits.[Footnote 2]
At your request, we reviewed VA's procedures for accrediting and
monitoring representatives. Specifically, this report examines (1) the
extent to which VA's procedures adequately ensure representatives meet
program requirements, and (2) any obstacles that may impede VA's
efforts to adequately implement its accreditation process. To identify
requirements for the program, we reviewed applicable federal laws,
regulations, and program guidance. To determine how VA carries out its
responsibilities and the challenges it faces, we interviewed officials
in VA's Office of General Counsel--which administers VA's
accreditation function--as well as the Veterans Benefits
Administration, which reviews disability benefits claims and awards
benefits. We also visited a VA regional office to obtain an
operational perspective. To gain further understanding of VA's
procedures for screening applicants and addressing complaints, we
reviewed a randomly selected and representative sample of 92
accreditation decisions made in 2012, and a judgmental sample of 24
complaints received by VA. Additionally, we judgmentally selected a
sample of 21 individuals--individuals who had either received
accreditation in 2012 or individuals for whom VA had received a
complaint in 2012--for additional checks into their criminal and
financial histories. To provide additional perspectives and further
context to our review, we interviewed officials from four national
organizations that represent veterans, as well as three organizations
that represent accredited attorneys or agents.
We conducted this performance audit from September 2012 to August 2013
in accordance with generally accepted government auditing standards.
These standards require that we plan and perform the audit to obtain
sufficient, appropriate evidence to provide a reasonable basis for our
findings and conclusions based on our audit objectives. We conducted
our related investigative work in accordance with investigation
standards prescribed by the Council of the Inspectors General on
Integrity and Efficiency. Additional information on our scope and
methodology is provided in Appendix I.
Background:
Although VA is required by law to assist claimants in obtaining the
evidence necessary to substantiate a claim for benefits, accreditation
helps ensure that claimants have access to qualified representation.
By law, only individuals accredited by VA can represent claimants in
the VA claims process.[Footnote 3] Table 1 below describes the three
types of individuals that VA recognizes as accredited representatives.
Table 1: Categories of Individuals Accredited by VA:
Category: Veteran Service Organization (VSO) representatives;
Who is eligible to apply: Employees or members of recognized veterans
service organizations.[A] VSOs are organizations recognized by VA that
serve the needs of veterans, such as providing information on benefits
and assistance in applying for them. Recognized organizations may be
private organizations, as well as state and local government entities.
Category: Attorneys;
Who is eligible to apply: Attorneys in good standing with a state bar.
Any attorney may apply regardless of the area of law in which they
specialize.
Category: Claim agents;
Who is eligible to apply: Any individual who is neither a service
organization representative nor an attorney. There is no occupational
or educational requirement, but examples include veteran's advocates
and financial planners.
Source: GAO analysis of VA regulations and VA.
[A] VA regulations establish a process by which VSOs may be officially
recognized by VA. Only recognized VSOs may seek accreditation for
their staff or members who wish to provide representation.
[End of table]
To implement accreditation, the law and VA regulations set forth a
number of requirements representatives must meet.[Footnote 4] For
example, representatives must:
* Be of good character: Although what constitutes good character is
not specifically defined, VA regulations provide, with respect to
agents and attorneys, that evidence showing a lack of good character
and reputation may include such things as: conviction of a felony or
other crimes related to fraud, theft, or deceit; or suspension or
disbarment from a court, bar, or government agency on ethical grounds.
In addition, all representatives are required to be truthful in their
dealings with claimants and VA.
* Provide competent representation: Representatives must provide
competent representation, which includes the knowledge, skills,
thoroughness, and preparation necessary for representation, as well as
an understanding of the issues of fact and law relevant to the claim.
* Provide prompt representation: Representatives must act with
reasonable diligence and promptness in representing claimants. This
includes responding promptly to VA requests for information or
assisting a claimant in responding promptly to VA requests for
information.
As of May 2013, VA had on its rolls approximately 20,000 individuals
who are accredited to represent claimants. Specifically, VA had
accredited 8,207 VSO representatives, 11,568 attorneys, and 345 claim
agents.
Available data demonstrate the growing role and importance of
accreditation. Since current program rules were adopted in mid-2008,
the number of applications VA received has grown from 2,696 in 2008 to
over 5,000 in each year since. Additionally, almost 80 percent of
claims that were open as of November 2012 used the services of a
representative, with VSOs accounting for the bulk of those claims (see
figure 1).
Figure 1: Number and Percentage of Open Claims by Representation Type:
[Refer to PDF for image: pie-chart]
Veteran Service Organization (VSO) representatives: 646,880; 76%;
No representation: 191,944; 22%;
Attorney or agent: 14,846; 2%.
Source: GAO analysis of VA data for claims open on November 30, 2012.
Note: Data provided by VA does not distinguish between attorneys and
agents. None reflects claimants who chose to pursue benefits on their
own, without the aid of any representative.
[End of figure]
VA's Office of General Counsel (OGC) oversees the accreditation
program. To this end, OGC staff review accreditation applications and
make approval decisions, monitor whether accredited representatives
meet ongoing program requirements, and investigate issues and
complaints that could lead to a representative having his or her
accreditation canceled or suspended. Table 2 describes the initial and
ongoing requirements for these representatives. Additionally, OGC
staff receive and review fee agreements--contracts between claimants
and representatives outlining how claimants will be charged for
services. Within VA, the Veterans Benefits Administration (VBA) also
plays a limited role in enforcing accreditation rules--checking that
individuals are accredited when claimants designate them as their
representative. In cases where an individual is not accredited, VA
policy is to inform the would-be representative of accreditation
program rules and prohibit the individual from serving as the
representative for that claim.
Table 2: Specific Initial and Ongoing Accreditation Requirements by
Type of Representative:
VSO:
Good character requirements:
Initial: VSOs recommending a prospective representative to VA must
certify the individual is of good character;
Ongoing: Representatives' good character must be recertified by their
VSO every 5 years;
Knowledge requirements:
Initial: VSOs recommending a prospective representative to VA must
certify the individual has demonstrated an ability to represent
claimants before VA;
Ongoing: Representatives' ability to represent claimants before VA
must be recertified by their VSO every 5 years.
Attorney:
Good character requirements:
Initial: Presumed to meet character requirements based on state bar
membership in good standing unless OGC receives credible information
to the contrary; must also provide character references and background
information, including information concerning criminal background, as
part of the accreditation application;
Ongoing: Must annually submit to VA information about any court, bar,
or federal or state agency to which they are admitted to practice or
authorized to appear, along with a certification that they are in good
standing;
Knowledge requirements:
Initial: As a condition of initial accreditation, required to complete
3 hours of qualifying continuing legal education (CLE) within 12
months;
Ongoing: Must complete an additional 3 hours of qualifying CLE within
3 years of initial accreditation and every 2 years thereafter.
Agent:
Good character requirements:
Initial: VA must make an affirmative determination of character before
a prospective agent can be accredited. Must provide character
references and provide background information in application to VA;
Ongoing: Same as ongoing attorney requirements above;
Knowledge requirements:
Initial: Same as initial attorney requirements above. In addition,
must pass a written examination by VA;
Ongoing: Same as ongoing attorney requirements above.
Source: VA regulations and VA.
[End of table]
VA rules also govern the fees that each type of representative can
charge claimants. VSO representatives are required to provide their
services free of charge. Attorneys and claim agents may not charge
claimants for services related to the initial preparation and filing
of their claims, but can charge fees for any services rendered after
VA makes an initial decision on a claim and the claimant initiates an
appeal of VA's decision.[Footnote 5] For services rendered after an
initial decision is made and an appeal is initiated, VA rules
generally allow attorneys and agents to charge a reasonable fee based
on retroactive benefits that are awarded. Fees that do not exceed 20
percent of any retroactive benefits are presumed to be reasonable.
VA's OGC may cancel accreditation if the representative fails to meet
any of the requirements for accreditation, knowingly presents a
fraudulent or frivolous claim, or demands or accepts unlawful
compensation. OGC may also suspend and reinstate the individual if he
or she meets conditions for reinstatement. Additionally, a VSO can
request that VA suspend or cancel accreditation for one of its
representatives based on misconduct or lack of competence. OGC is
required to inform representatives of the nature of their alleged
violation and representatives may request a hearing on the matter. An
OGC decision can be appealed to the Board of Veteran's Appeals.
VA's Procedures and Requirements Do Not Sufficiently Ensure That
Representatives Are Qualified:
VA Does Not Sufficiently Assess Whether Representatives Have Good
Character:
VA consistently follows its procedures when reviewing applications for
accreditation; however, those procedures are not sufficient to ensure
representatives have good character.[Footnote 6] Based on our analysis
of a sample of 92 accreditation decisions for attorneys and
agents,[Footnote 7] we estimate that VA correctly followed its
procedures in 95 percent of applications approved in 2012.[Footnote 8]
Such procedures include ensuring that applicants have appropriate
qualifications (such as bar membership for attorneys), and obtaining
additional information when applicants state they had prior criminal
activity or other incidents that could call their character into
question. That said, we identified several limitations in VA's
accreditation procedures and requirements that call into question
whether VA can adequately ensure the character of accredited
representatives. These include:
Reliance on limited data: VA relies on attorneys and agents to self-
report background information on their accreditation applications. For
example, these applicants are expected to provide true and correct
information about issues such as their criminal history, but VA does
not independently verify this information to ensure that applicants
were honest about their criminal history. Because they do not verify
applicants' information, OGC officials told us they could unknowingly
accredit individuals who lack good character. Additionally, VA does
not collect additional information, such as Social Security numbers or
credit histories, which could be used to conduct a more thorough
review of applicants' backgrounds. For instance, when we conducted
further inquiries into the backgrounds of accredited attorneys and
agents, we found in 9 of 20 instances that individuals had histories
of bankruptcies or liens.[Footnote 9] We also searched to see if these
individuals had a criminal history that would warrant further follow-
up from VA or had professional licenses suspended, but did not find
any such instances. While VA does not currently consider bankruptcies
or liens as grounds for barring or canceling an individual from being
accredited, soliciting and confirming such information may provide a
more complete picture about an individual's financial situation and
management, and could prompt further inquiries that can inform the
accreditation decision. The official that oversees accreditation
acknowledged that additional background information, particularly on
agents who are also financial planners, would be useful in informing
VA's judgment of their character. Subsequent to our May 2013 exit
briefing with VA, OGC officials informed us that they recently gained
access to VBA's system to conduct background searches and are
developing plans to conduct comprehensive background checks on all
claim agent applicants and on attorney applicants as necessary. The
official that oversees accreditation also stated that VA is
considering requiring applicants to supply information on any
professional certifications they hold and confirming this information
with agencies like the Financial Industry Regulatory Authority, which
regulates brokers' activities.
Not consistently following up on references: VA may be missing
opportunities to obtain additional information about applicants by not
consistently following up on character references. While attorneys and
agents are required to provide references in their accreditation
applications, the official who oversees accreditation told us that VA
contacts references only for agents, which we verified in our review
of applications. Further, the value of reference letters VA receives
is questionable as VA did not use a standard set of questions or
guidance to obtain specific information that should be included in
reference letters, such as requesting information on the agents'
criminal or employment history. Several reference letters we reviewed
did not provide substantial information on applicants' ability to
assist veterans. In one instance, VA had to request additional
reference letters for an applicant because two of the applicant's
reference letters were from members of the same church group and had
identical language. Additionally, we found several instances where
references listed in applications were family members or lived at the
same address as the applicant, calling into question the impartiality
of the information received. At our May 2013 exit briefing with VA,
officials announced that VA has revised and will begin using a
standardized letter to references to specifically request information
on agents' criminal and employment histories, as well as their
interest in serving veterans.
Reliance on VSOs and state bars: OGC officials told us that they rely
heavily on the judgment of VSOs when deciding whether to accredit
their prospective representatives. OGC officials told us that they
believe VSOs do a good job of screening their applicants and that it
is in the best interests of VSOs to maintain a positive reputation
regarding the quality of representation they provide as VSOs depend on
contributions from veterans to fund their operations. That said, VA
does not actively review VSO certification plans and therefore cannot
know whether there is variability in procedures and standards among
organizations. Regarding attorneys, VA generally presumes good
character and fitness to represent claimants if they have a state bar
membership in good standing. However, our work shows that an
attorney's standing with a state bar may not always be a sufficient
proxy for good character. In one example, an attorney was in good
standing with his state bar, but he had several previous suspensions
from the bar and multiple felonies in his criminal record involving
theft or misappropriation of property or funds. In this instance, VA
chose not to accredit the individual based on his self-reported
criminal record, but it is not clear what the outcome would have been
had VA relied on his bar membership status in the absence of such self-
reported information.
Limited ongoing monitoring: Once representatives become accredited, VA
does little to ensure that they retain good character. VA requires
attorneys and agents to annually certify that they are in good
standing with any court, bar, or federal or state agency to which they
are admitted to practice or authorized to appear. VA also requires
VSOs to recertify their representatives every 5 years. However, VA
officials told us that they currently face a backlog in processing
these annual certifications and therefore have not consistently
monitored whether these re-certifications have occurred. For example,
the official that oversees accreditation told us that in one instance,
an attorney self-reported in a letter to VA that he was disbarred and
that his accreditation should be canceled. Since VA does not
consistently monitor whether attorneys annually certify their standing
with the bar, the agency would not have known that this individual was
disbarred had he not voluntarily communicated this information. After
our May 2013 exit briefing with VA, OGC informed us that they are
developing plans to annually audit the certifications of good standing
that attorneys and agents file.
VA Requirements Do Not Ensure Representatives Are Knowledgeable:
VA's initial knowledge requirements for attorneys and agents are
limited and do not ensure that they are knowledgeable about VA
benefits. To become accredited, agents must pass an exam comprised of
25 multiple-choice and true-false questions. However, organizations
that represent or help train agents told us the exam covers a wide
array of subjects concerning veterans' benefits law and procedure
without deeply broaching any particular topic. Further, they said that
the exam alone is not sufficient to determine whether agents have
enough knowledge to represent veterans. For attorneys, VA presumes
that any attorney in good standing with the bar is qualified and
knowledgeable enough to assist veterans. As such, attorneys are not
required to take an initial exam to demonstrate their knowledge of
veterans' benefits law. However, officials from two organizations that
provide training for accreditation told us that membership with the
bar does not guarantee that an individual is knowledgeable about VA
benefits law. One attorney noted that it can take years to understand
VA benefits issues and provide knowledgeable assistance in this area.
In fact, representatives from one VSO told us that attorneys and
agents often contact VSOs with questions about representing their
claimants.
In addition, VA's initial and ongoing training requirements do not
ensure accredited attorneys and agents are knowledgeable and VA does
not consistently enforce existing requirements. In addition to
requiring that attorneys and agents complete 3 hours of qualifying
continuing legal education (CLE) within 12 months as an initial
condition of accreditation, VA requires that accredited attorneys and
agents complete 3 hours of training every 2 years, and that this
training cover certain topics such as representation before VA, claims
procedures, basic eligibility for benefits, and appeal rights.
Officials from two organizations that provide training for
accreditation told us that this amount of training is not sufficient
to ensure that attorneys and agents are knowledgeable. Additionally,
officials from these organizations told us that VA does not review, or
provide guidance on course content. OGC officials told us that they
rely on each state bar association to approve its own training, which
can introduce variability across states. Moreover, VA does not
consistently ensure that attorneys and agents complete required
training. OGC officials told us that individuals who do not certify
their training requirements could have their accreditation suspended.
Despite this, OGC has fallen behind on its monitoring of this
requirement, and it is likely that individuals who should not be
accredited continue to assist claimants. After our May 2013 exit
briefing with VA, OGC officials informed us that they are developing
plans to annually audit the training certifications which attorneys
and agents must file with OGC.
VA relies on VSOs to train their representatives and ensure that VSO
representatives can provide knowledgeable assistance to veterans with
relatively little oversight from VA. We spoke to three national VSOs
who noted that they provide numerous training opportunities for their
representatives, which may include on-the-job training, seminars, and
regular conferences. Two VSOs we spoke with also said that they
monitor whether their representatives are meeting knowledge
requirements. However, the official who oversees accreditation said VA
relies on VSOs to ensure their staff have appropriate training and
that VA does not review VSO training programs. While VA did not
express concerns about VSO representatives meeting knowledge
requirements, GAO's standards for internal controls state that
information about a program's operations should be communicated to
management, in order to determine whether the agency is achieving
compliance requirements under relevant laws and regulations.[Footnote
10] Absent better oversight of VSO training, VA cannot ensure the
knowledge of representatives who represent a majority of claimants.
Representatives' knowledge is critical to meeting another VA
requirement--ensuring that they provide prompt representation.
Officials at one regional office noted that some representatives are
less knowledgeable than others and that they might forget or overlook
certain items in a claim. At the same time, they stated that it is
VA's responsibility to review claims to make sure they are complete
and to notify claimants when information is missing. However,
officials from an organization representing attorneys and agents told
us that VA does not consistently follow up with veterans to make sure
that their paperwork is complete and there have been instances where
mistakes on initial claims resulted in veterans losing the ability to
claim benefits that they were entitled to receive. Similarly, the
officials told us that a representative who is not knowledgeable
enough to use the appropriate language for appealing a decision may
result in VA not recognizing the communication as a formal
disagreement with VA's decision, in turn causing the veteran to miss
the deadline for appealing their claims case.
Inadequate Resource Allocation and Unclear Communication with
Claimants Hinder Efforts to Administer Accreditation:
Inadequate Staffing and Information Technology Leads to Backlogs and
Limited Program Monitoring:
VA has dedicated only a few staff to administer its accreditation
program, which has resulted in limited monitoring efforts and workload
backlogs. VA officials told us that approximately four staff positions
in OGC are dedicated to accreditation. These staff are responsible for
reviewing thousands of applications each year, and ensuring that the
approximately 20,000 individuals already accredited meet continuing
requirements. Officials told us this level of staffing is insufficient
to carry out all these responsibilities and that VA has chosen to
prioritize screening initial accreditation applications over
monitoring ongoing requirements. Even so, VA has a significant backlog
of accreditation applications to review. VA estimates that it may take
60 to 120 days to review an application after it is received. Because
by law only accredited individuals may represent claimants, this
backlog may cause delays for claimants who need assistance with their
claims.
VA currently has no plans to permanently increase the number of staff
dedicated to accreditation. OGC officials told us that they have been
seeking to increase the number of staff working on accreditation, but
have been unsuccessful in obtaining additional permanent staff. An
official noted that in the fall of 2012, several staff were assigned
to accreditation on a temporary basis and, with their help, OGC was
able to eliminate its backlog of attorney and VSO representative
applications. However, OGC stated that a considerable backlog of agent
applications remains and it is likely the backlog of attorney and VSO
representative applications will return since this temporary
initiative has ended. Moreover, as of May 2013, one of the four
positions was not filled because of a resignation. OGC is in the
process of replacing staff lost to attrition as well as obtaining an
additional temporary staff person. Still, OGC officials stated that
they would need several additional staff beyond the four dedicated
positions to function more effectively. It is questionable if this
will happen in the near future as VA's proposed fiscal year 2014
budget calls for fewer staff in VA's OGC. This may also affect OGC's
plans to increase its oversight of accredited representatives because
those plans are contingent upon eliminating the backlog of initial
applications.
VA's implementation of its accreditation process is also hampered by
limited information technology (IT) support. Officials told us that
the database system used by OGC cannot automatically inform
individuals that they are meeting program requirements and OGC staff
must do this manually. Further, an official noted that a significant
amount of data entry is required when applicants submit information
for accreditation. Officials noted that other IT improvements, such as
the ability for applicants to electronically submit applications, or
for accredited representatives to submit certifications of good
standing and training certifications would help OGC manage its
responsibilities more efficiently. However, no steps have been taken
to date toward developing these capabilities.
VA's Oversight Is Limited by a Lack of Outreach to Claimants and an
Unclear Complaint Process:
VA's ability to identify and address abuses by representatives is
limited because VA has missed opportunities to educate claimants about
their rights and protections against potential abuses. In prior work,
we reported that targeted communication with a specific message is a
best practice for outreach to veterans.[Footnote 11] Individuals who
do not yet have representation receive a letter from VA after
submitting a claim containing some information on representation--such
as explaining what VSOs are and that they provide assistance at no
charge. However, the letter does not discuss attorneys and agents, nor
does it note that a claimant should not have to pay for services
associated with filing an initial claim. Similarly, the form that
claimants use to designate an attorney or agent[Footnote 12] refers
individuals to the section of the law governing fees, but does not
explain that claimants should not pay for filing an initial claim.
Beyond these forms, VBA officials told us that VA does not actively
conduct outreach to claimants regarding representation, what to expect
from their representative, or their right to not pay filing fees for
initial claims. As a result, several VSOs we interviewed stated that
veterans are often unaware of their rights or what to expect during
the claims process. One VSO service officer told us that nearly all
veterans he encounters are unaware that they should not pay to file
initial claims. He added that if a veteran is told that he or she must
pay a fee, the veteran will usually just assume this is how business
is done. Further, many of the complaints to VA we reviewed regarded
improper fees.
VA's ability to learn about and address potential abuses also may be
hampered by a complaint process that is not well-communicated to
claimants. GAO standards for internal controls state that effective
communications--such as with external stakeholders--is critical for
agencies to ensure they receive information that may significantly
affect whether they achieve their objectives. While VA regulations
establish a complaint process, VA may be missing opportunities to
serve and protect claimants as it has not clearly communicated to
claimants or others how to report concerns about representatives.
[Footnote 13] For example, VA's accreditation website does not
explicitly state how to report concerns about representatives. While
the website provides a link to an e-mail address used for general
inquiries, an official noted that OGC receives a large volume of
emails at this address--including complaints--and is behind in
responding to inquiries. Additionally, the materials provided to
individuals when filing a claim also do not clearly state how to
report complaints. When we interviewed veterans at two VSOs in the
D.C. area, we generally found that they were unfamiliar with program
requirements and did not know where or how to file a complaint.
Further, the process of responding to and addressing complaints--which
can be difficult and lengthy--is understaffed, thereby limiting its
effectiveness. VA officials told us they require clear and convincing
evidence in order to cancel a representative's accreditation. One
official noted the process of monitoring representatives who received
complaints is difficult given competing demands for resources.
Additionally, collecting evidence can be difficult because claimants
may be reluctant to reveal their identities when making complaints.
They added that some cancellation actions may take years to resolve
when representatives exercise their right to appeal decisions. An OGC
official told us that allocated resources were currently inadequate to
effectively monitor representatives about whom complaints had been
submitted and that information about complaints is not shared with
other parts of VA. For instance, OGC does not share information with
VBA that could help identify or monitor the activities of
representatives with complaints. OGC estimated that only two attorneys
or agents had their accreditation canceled over the last 5 years for
violating the rules of the program and none were suspended.[Footnote
14]
Accreditation Does Not Address Some Emerging Threats:
VA faces challenges with unaccredited individuals helping veterans
file claims and charging claimants for assistance. While federal
regulations require representatives to be accredited, we found a
number of complaints about individuals who are not accredited filing
claims for veterans. Of the 24 complaints filed against attorneys and
agents in 2012, 7 were regarding unaccredited individuals. Because VA
is not aware of the extent to which these individuals interact with
claimants, VA cannot take action or ensure they provide quality
services. An OGC official told us that when it learns of these
individuals, it is limited in the actions it can take beyond
instructing the individual to stop. Additionally, he said he has
written to state attorneys general offices regarding potential
wrongful actions a few times in the last year, but does not know if
the states took action. In our review, we found a few instances in
which OGC sent letters concerning unaccredited individuals to state
attorneys general only to continue to receive complaints about these
individuals. An OGC official added that, beyond canceling or
suspending accreditation, there are no penalties for individuals who
violate the requirements of accreditation and that cases generally are
not referred to VA's Inspector General.
Accreditation also does not address whether individuals should sell
financial products to veterans. Our prior work has shown that some
accredited individuals were selling financial products to veterans in
order to shelter assets and allow them to qualify for VA pension
benefits.[Footnote 15] Some of these cases involved vulnerable
populations, such as veterans in assisted living facilities, or
involved individuals selling products that resulted in veterans losing
control of their assets without qualifying for VA benefits. VA and
some VSO officials told us that financial planners continue to be an
area of concern. VA officials told us that an increasing number of
financial planners are applying for accreditation as agents. In fact,
all six of the agents in our file review appeared to have a financial
planning background. VA also told us that when an individual with a
financial planning background applies for accreditation, it asks for
additional information about their business plans, reviews any
business websites, and reminds applicants that the purpose of
accreditation is to provide assistance to veterans and that they
should not use accreditation to promote financial products. That said,
the official who oversees accreditation told us that they often lack a
sufficient basis to deny accreditation to these individuals because
being a financial planner in and of itself does not violate VA's
accreditation rules. He added that it might be helpful to collect
additional information on these individuals, such as from financial
regulators, when deciding whether to accredit them.
It is also difficult for VA to ensure that claimants are being charged
appropriate fees. Attorneys and agents are not allowed to charge or
receive a fee for the preparation or initial filing of a claim, but
are allowed to charge a fee for services provided after VA has decided
the claim and a notice of disagreement has been filed initiating an
appeal of that decision. The allowable fee is often 20 percent of
retroactive benefits awarded if the claim is granted. However, there
is no restriction on fees charged for services before an individual
files a claim. VA's OGC issued a letter in 2004 noting that attorneys
may charge claimants for services that are rendered before the
individual begins the process of filing a claim, such as consulting
with the individual about the range of VA and other federal benefits
he or she may qualify for. Some VSOs and other experts expressed some
concern regarding pre-filing consultation fees. The head of one VSO
noted that these fees may serve as a mechanism to hide the fact that
attorneys and agents are charging claimants for preparing claims.
Ambiguity regarding these fees makes it difficult for claimants and VA
to know whether they are being charged allowable fees, and may result
in attorneys inappropriately billing for work related to the claim as
if it was for a general consultation. Because fees for pre-filing
activities are outside the claims process, VA also has no way of
knowing the extent to which they occur or are properly charged. More
than half of the complaints against attorneys and agents (15 of 24)
that we reviewed were related to fees.
Conclusions:
Hundreds of thousands of veterans and their families rely on
accredited representatives to guide them through the process of
applying for VA benefits. However, current program implementation and
requirements do not sufficiently ensure that veterans and their
families are protected against potential abuses or that VA has the
ability to identify and address situations where representatives are
not acting in the best interests of clients. While recent plans to
collect more information on applicants and increase oversight of
existing representatives are promising, it is unclear how OGC will
implement and sustain these improvements given the current level of
resources VA has allocated to this program. Additionally, without
providing better information to claimants about how to report issues
or concerns about their representation, claimants may not know where
to turn to report an abuse or not even recognize that their
representative is engaged in prohibited practices. Lastly, claimants
may be vulnerable to emerging threats--such as unaccredited
representatives--in the absence of VA tools to provide protection. We
recognize that in considering program enhancements, VA will need to
balance the effort of instituting changes and the additional burdens
they may place on program staff and representatives with ensuring that
claimants continue to have ready access to representation. However,
representatives with ill-intent or poor knowledge can cause real harm
to claimants and a weak accreditation process will negatively affect
VA's ability to provide veterans the benefits to which they are
entitled.
Recommendations for Executive Action:
To improve VA's ability to ensure that claimants are represented by
qualified and responsible individuals, the Secretary of Veterans
Affairs should explore options and take steps to:
1. Ensure an appropriate level of staff and IT resources are in place
to implement the requirements of the accreditation program. This
should include exploring options for utilizing other VA components and
resources outside of OGC.
2. Strengthen initial and continuing knowledge requirements for
accreditation for all types of representatives.
3. Enhance communications with claimants, including how they can
report complaints related to their representation. This could include
exploring options for incorporating information about representation
and veterans' rights into existing communications and outreach efforts.
4. Address potentially abusive practices by representatives who lack
accreditation, charge inappropriate fees, or sell financial products
to claimants that are not in their best interest. If necessary, VA
should consider seeking additional legislative authority to address
such practices and enforce program rules.
Agency Comments and Our Evaluation:
We provided a draft of this report to the Secretary of Veterans
Affairs for review and comment. In its comments (see app. II), VA
generally agreed with our conclusions, and either concurred or
concurred in principle or in part with our recommendations, as
discussed more fully below.
VA concurred in principle with our first recommendation to ensure
accreditation has appropriate staffing and IT resources, noting that
efforts to increase staff and obtain IT resources must be considered
within the existing OGC budget. We agree and fully support VA's plans
to identify available resources within and outside of OGC.
VA concurred in principle with our second recommendation that it
explore strengthening initial and continuing knowledge requirements.
VA stated that it believes that existing initial knowledge
requirements for attorneys and agents adequately ensure that VA
claimants have qualified representation. Additionally, VA expressed
concerns that additional knowledge or testing requirements could have
a chilling effect on attorney representation for claimants.
Nevertheless, VA stated that it will consider ways in which it can
equip newly accredited attorneys and agents with information regarding
veterans benefits law and procedures. Additionally, VA stated it plans
to revise and update examinations for prospective agents to ensure
they have adequate knowledge of veterans law and procedures. Regarding
VSO representatives, VA reiterated that it believes it is in each
organization's best interest to ensure their representatives are
competent and qualified. Nevertheless, VA plans to request and review
training curricula for up to about 10 percent of recognized
organizations each year--an effort which we commend. We support these
efforts, but continue to believe VA should consider ways to better
equip all accredited attorneys and agents with relevant information
and not limit efforts to just newly accredited attorneys and agents,
for example, by improving the quality of required continuing legal
education.
Regarding our recommendation to enhance communications with claimants,
VA concurred and plans to include information on how to report
complaints on OGC's accreditation Web site, and will work with VBA to
identify potential outreach activities. We agree with VA's stated
efforts to improve communication with claimants.
VA also concurred in principle with our recommendation to explore
options for addressing potentially abusive practices by
representatives and stated it would consider seeking additional
legislative authority to address these practices and enforce program
rules. VA noted that imposing penalties on unaccredited individuals,
individuals who inappropriately charge claimants, or sell financial
products to claimants could help curb inappropriate practices, but in
some cases may have a chilling effect on the legitimate activities of
others. We acknowledge that penalties may be an appropriate deterrent
in some but not all circumstances and agree with VA's desire to
balance any changes with maintaining access for claimants to valuable
assistance. We also urge VA to further explore other remedies that
would not require legislative action, such as closer cooperation with
state and local law enforcement regarding individuals who may commit
unlawful acts.
As agreed with your offices, unless you publicly announce the contents
of this report earlier, we plan no further distribution until 30 days
from the report date. At that time, we will send copies of this report
to the appropriate congressional committees, the Secretary of Veterans
Affairs, and other interested parties. In addition, this document will
be available at no charge on GAO's Web site at [hyperlink,
http://www.gao.gov].
If you or your staff have any questions about this report, please
contact me at (202) 512-7215 or at bertonid@gao.gov. Contact points
for our Offices of Congressional Relations and Public Affairs may be
found on the last page of this report. Staff members who made key
contributions to this report are listed in Appendix III.
Signed by:
Daniel Bertoni:
Director, Education, Workforce, and Income Security:
List of Requesters:
The Honorable Patty Murray:
Chairman:
Committee on the Budget:
United States Senate:
The Honorable Bernie Sanders:
Chairman:
The Honorable Richard Burr:
Ranking Member:
Committee on Veterans' Affairs:
United States Senate:
The Honorable Bill Nelson:
Chairman:
Special Committee on Aging:
United States Senate:
[End of section]
Appendix I: Objectives, Scope, and Methodology:
In conducting our review of how the Department of Veterans Affairs
(VA) accredits and oversees veterans' representatives, our objectives
were to examine (1) the extent to which VA's procedures adequately
ensure representatives meet program requirements, and (2) any
obstacles that may impede VA's effort to adequately implement its
accreditation process. We conducted this performance audit from
September 2012 to August 2013, in accordance with generally accepted
government auditing standards. These standards require that we plan
and perform the audit to obtain sufficient, appropriate evidence to
provide a reasonable basis for our findings and conclusions based on
our audit objectives. We believe the evidence obtained provides a
reasonable basis for our findings and conclusions based on our audit
objectives. We conducted our related investigative work in accordance
with investigation standards prescribed by the Council of the
Inspectors General on Integrity and Efficiency.
To determine the extent to which VA's procedures are adequate, we
reviewed pertinent federal laws and regulations and interviewed
officials in VA's Office of General Counsel (OGC) and Veterans
Benefits Administration. To assess the extent to which VA carries out
its procedures, we reviewed a random, representative sample of 92 case
files for attorneys and agents who were granted accreditation in 2012.
[Footnote 16] We examined these files to determine whether individuals
provided complete information on their personal histories, whether
individuals had the appropriate qualifications, and to determine
whether VA took steps to collect additional information when
necessary. We determined whether the evidence in each file indicated
that VA carried out the procedures that VA officials stated they
follow when reviewing files.[Footnote 17] Additionally, we reviewed
all 24 complaints that OGC received in 2012 regarding attorneys and
claim agents in order to understand the actions that VA takes in
response to concerns. Additionally, we selected a random, judgmental
sample of 21 attorneys and agents to determine whether an independent
background check would uncover issues that could call their character
into question. These 21 individuals consisted of 5 attorneys and 6
agents selected in our random sample of 2012 accreditation decisions,
and 5 attorneys and 5 agents whose complaint files we reviewed.
[Footnote 18] We used Accurint--a commercial database of public
records--to determine whether these individuals had (1) a criminal
history, (2) bankruptcies, (3) liens, or (4) professional licenses
revoked. In the instances in which Accurint delivered a positive
result, we confirmed the result by obtaining court records.
To provide further context on VA's procedures and to determine
obstacles that impede VA's efforts to adequately implement
accreditation, we interviewed a number of veterans service
organizations (VSO)--which both assist veterans in filing claims and
advocate for their interests--and organizations that represent
attorneys and claim agents (see table 3).
Table 3: Organizations Interviewed by GAO:
Veterans service organizations:
* American Legion;
* Disabled American Veterans;
* National Veterans Legal Services Program;
* Veterans of Foreign Wars.
Groups representing attorneys or agents:
* Academy of VA Pension Planners;
* National Care Planning Council;
* National Organization of Veterans' Advocates.
Source: GAO.
[End of table]
Additionally, we conducted a site visit to the Philadelphia VA
Regional Office where we interviewed regional managers, veterans
service representatives, and staff who review fee agreements, as well
as local VSO representatives. Finally, we informally met with groups
of veterans who were present at two VSOs in the Washington, D.C. area
on the days of our visits, to obtain views on their experiences with
representation.
[End of section]
Appendix II: Comments from the Department of Veterans Affairs:
Department of Veterans Affairs:
Washington, DC 20420:
July 10, 2013
Mr. Daniel Bertoni:
Director, Education, Workforce, and Income Security Issues:
U.S. Government Accountability Office:
441 G Street, NW:
Washington, DC 20548:
Dear Mr. Bertoni:
The Department of Veterans Affairs (VA) has reviewed the Government
Accountability Office's (GAO) draft report, "VA Benefits: Improvements
Needed to Ensure Claimants Receive Appropriate Representation" (GA0-13-
643). VA generally agrees with GAO's conclusions and concurs in
principle with recommendation 1, concurs in part with recommendation
2, and concurs with GAO's recommendations 3 and 4, to the Department.
The enclosure specifically addresses GAO's recommendations and
provides technical comments to the draft report. VA appreciates the
opportunity to comment on your draft report.
Sincerely,
Signed by:
Jose D. Riojas:
Interim Chief of Staff:
Enclosure:
Department of Veterans Affairs (VA) Comments to Government
Accountability Office (GAO) Draft Report "VA BENEFITS: Improvements
Needed to Ensure Claimants Receive Appropriate Representation"
(GA0-13-643):
GAO Recommendation: To improve VA's ability to ensure that claimants are
represented by qualified and responsible individuals, the Secretary of
Veterans Affairs should explore options and take steps to:
Recommendation 1: Ensure an appropriate level of staff and IT
resources are in place to implement the requirements of the
accreditation program. This should include exploring options for
utilizing other VA components and resources outside of OGC.
VA Comment: Concur in principle. Although the Department of Veterans
Affairs (VA) agrees that it would be beneficial for the Office of
General Counsel (OGC) to increase its staff and obtain additional
Information Technology (IT) support to implement the requirements of
the accreditation program, this recommendation must be considered
within the existing OGC budget. VA will continue to explore staffing
and IT options within and outside of OGC.
Recommendation 2: Strengthen initial and continuing knowledge
requirements for accreditation for all types of representatives.
VA Comment: Concur in principle. Section 5904(a)(2) of title 38,
United States Code (U.S.C.), requires VA to prescribe in regulations a
requirement that, as a condition of accreditation as an agent or
attorney, an individual must have either a specific level of
experience or specialized training. An applicant for accreditation as
either an attorney or agent "must establish that he or she is of good
character and reputation, is qualified to render valuable assistance
to claimants, and is otherwise competent to advise and assist
claimants in the preparation, presentation, and prosecution of their
claim(s) before VA." 38 Code of Federal Regulations (CFR) §
14.629(b)(2).
With regard to strengthening initial knowledge requirements for
accreditation for attorneys, VA believes that the current requirements
adequately ensure qualified representation of VA claimants. As part of
their initial accreditation requirements, attorneys must have a law
degree, be a member in good standing of a state bar, and, during the
first 12-month period following initial accreditation, complete 3
hours of state-bar approved Continuing Legal Education (CLE) training
covering Veterans benefits law and procedure. To impose additional
testing or knowledge requirements on attorneys may have a chilling
effect on attorney representation for VA claimants, in particular pro
bono representation of indigent Veterans. We believe that, generally,
the formal education and testing already required of licensed
attorneys, attorneys' ethical responsibilities concerning
representation, along with VA's CLE requirements, adequately balance
the competing interests of ensuring qualified representation with
facilitating choice of representation for VA claimants. However, VA
will consider ways in which we may be able to equip newly accredited
attorneys with information regarding Veterans benefits law and
procedures.
With regard to strengthening initial knowledge requirements for
accreditation for agents, VA believes that the current requirements
adequately ensure qualified representation of VA claimants. As part of
their initial accreditation requirements, agents must pass a written
examination administered by VA, which covers a wide range of topics
covering the applicant's knowledge of VA benefits and the VA claims
adjudication process, and complete the same CLE training as attorneys.
38 CFR § 14.629(b). The sole purpose of VA's accreditation examination
is to objectively determine whether an agent has the qualifications
necessary to provide competent representation before VA. VA continues
to believe that examinations are necessary for agent applicants
because they have not completed similar legal training as attorneys or
passed a state-bar administered examination. However, VA plans to
revise and update our examinations to further ensure that they are
adequately testing an agent applicant's knowledge of current Veterans'
benefits law and procedure. As with attorneys, VA will also consider
ways in which VA may be able to equip newly accredited agents with
information regarding Veterans benefits law and procedures.
As GAO notes in its report, in order to strengthen continuing
knowledge requirements for accreditation for attorneys and agents, OGC
plans to annually audit the training certifications which attorneys
and agents must file with OGC to ensure timely and adequate
submissions. In light of OGC's limited resources, VA believes this new
audit plan will sufficiently hold accredited attorneys and agents
accountable in completing necessary CLE training on Veterans benefits
law and procedures to maintain VA's accreditation.
With regard to Veterans Service Organization (VSO) representatives, VA
relies heavily on the organizations to provide adequate training for
their representatives. We believe it is within each organization's
interest to ensure that its accredited representatives are competent
and qualified to represent claimants before VA. For each individual a
VSO desires accredited as a representative of that organization, the
VSO must certify that the individual "has demonstrated an ability to
represent claimants before VA." 38 CFR § 14.629(a). VA currently does
not have the resources to review screening procedures and training
curricula for 92 VA-recognized organizations. However, VA plans to
request and review training curricula for up to nine organizations
every year to ensure that they provide adequate training for their
representatives.
To the extent VA receives complaints regarding the qualifications or
competence of specific accredited attorneys, agents, or VSO
representatives, we have procedures in place to initiate inquiries and
proceedings to suspend or cancel their accreditation. 38 CFR § 14.633.
Recommendation 3: Enhance communications with claimants, including how
they can report complaints related to their representation. This could
include exploring options for incorporating information about
representation and veterans' rights into existing communications and
outreach efforts.
VA Comment: Concur. VA plans to add information on OGC's public
accreditation Web site about how to report complaints to OGC regarding
unlawful or unethical practices or incompetent representation by
accredited individuals. Complaints could also include information
regarding an accredited individual's suspension or disbarment by any
court, bar, or Federal or state agency to which such individual was
previously admitted to practice. OGC will work with the Veterans
Benefits Administration on identifying potential outreach
opportunities.
Recommendation 4: Address potentially abusive practices by
representatives who lack accreditation, charge inappropriate fees, or
sell financial products to claimants that are not in their best
interest. If necessary, VA should consider seeking additional
legislative authority to address such practices and enforce
program rules.
VA Comment: Concur in principle. VA will consider seeking additional
legislative authority to address abusive practices and enforce program
rules. (Any such legislative proposals would require Executive Branch
clearance.)
Currently, if VA determines that an unaccredited individual is
assisting claimants with their claims for VA benefits, VA may notify
such individual to cease the unlawful practice. VA will not recognize
an unaccredited individual as a claimant's representative. There are,
however, no penalties under Federal law for assisting a claimant in
the preparation, presentation, or prosecution of a claim without
accreditation. Legislation that would impose penalties on unaccredited
individuals who assist claimants with their claims for VA benefits
could potentially help reduce this unlawful practice. However, such
legislation might also penalize the acts of well-intentioned
unaccredited individuals who assist claimants without knowledge of the
laws against such practice. It may also have an unintended chilling
effect on individuals who want to assist Veterans in other capacities,
such as by merely educating claimants about the benefits that might be
available to them, which does not require VA accreditation.
Currently, if VA determines that an accredited or unaccredited
individual is charging a fee for assisting claimants with applications
for VA benefits, VA may notify such individual to cease the unlawful
practice. If VA determines that an accredited individual is improperly
charging a fee for preparing, presenting, or prosecuting a claim prior
to the filing of a notice of disagreement with a VA regional office
decision, VA may suspend or cancel the individual's accreditation. If
an unaccredited individual fails to cease the unlawful practice, VA
will report the individual to state or local agencies or offices that
enforce unauthorized practice, unfair business practice, or consumer
or senior fraud laws. There are, however, no criminal penalties under
Federal law for unlawfully charging a fee for assisting a claimant
with an application for VA benefits. Legislation that would impose
penalties on accredited and unaccredited individuals who charge a
fee for assisting claimants with their applications for VA benefits
could potentially help curb this unlawful practice. Under former 38
U.S.C. § 5905(1) (2002), it was a misdemeanor to solicit or charge
fees for assisting a claimant with a claim for VA benefits before an
initial decision by the Board of Veterans' Appeals. However, Congress
repealed this provision in December 2006 with the enactment of Public
Law 109-461, most likely to encourage representation of claimants in
their claims for VA benefits.
Currently, as noted in the GAO report, when an individual with a
financial planning background applies for accreditation, VA asks for
additional information about their business plans, review any business
Web sites, and make it clear that VA does not accredit individuals for
the purpose of promoting their other business interests involving
insurance, annuities, or other financial products. VA informs them
that if we learn that an accredited individual is using VA
accreditation for a purpose other than assisting in the preparation,
presentation, and prosecution of a claim, VA will consider suspending
or canceling his or her accreditation. As further noted in the GAO
report, VA often lacks a sufficient basis to deny accreditation to
these individuals because being a financial planner in and of itself
does not violate VA's accreditation rules. VA does not have authority
to preclude VA-accredited representatives, agents, or attorneys from
selling financial products to claimants-they simply cannot use their
accreditation for that purpose. However, VA is considering requiring
applicants to submit information on any professional certifications
they hold and confirming this information with agencies like the
Financial Industry Regulatory Authority. Although VA informs
applicants for accreditation that it is unlawful to use VA
accreditation for the purpose of promoting or selling financial
products, in practice, it is difficult to assess when that is actually
occurring. Legislation that would impose penalties on accredited
individuals who sell financial products to claimants may help deter
such individuals from using their accreditation to sell financial
products to claimants. However, such legislation may deter well-
intentioned individuals from pursuing accreditation to assist Veterans
and may also deprive claimants of opportunities to learn of financial
products that would be beneficial to them.
[End of section]
Appendix III: GAO Contact and Staff Acknowledgments:
GAO Contact:
Daniel Bertoni, (202) 512-7215 or bertonid@gao.gov.
Staff Acknowledgments:
In addition to the contact named above, Michele Grgich and Lori
Rectanus (Assistant Directors), Daniel Concepcion and Aimee Elivert
made key contributions to this report. David Chrisinger, Paul
Desaulniers, Sheila McCoy, Wayne McElrath, Dae Park, Almeta Spencer,
Roger Thomas, and Walter Vance provided support.
[End of section]
Footnotes:
[1] VA uses the term representative to refer only to individuals
affiliated with recognized veteran service organizations, but for the
purposes of this report, we use the term more broadly to include all
individuals accredited by VA, unless it is specifically stated that we
are referring only to representatives of veteran service organizations.
[2] Veterans' Pension Benefits: Improvements Needed to Ensure Only
Qualified Veterans and Survivors Receive Benefits, [hyperlink,
http://www.gao.gov/products/GAO-12-540] (Washington, D.C.: May 15,
2012).
[3] VA allows for a one-time exemption so that claimants can designate
non-accredited individuals as their representative, without
compensation. VA officials told us that this exemption can be used by
claimants who wish to designate a family member as their
representative.
[4] See 38 U.S.C. §§ 5901-5905 and 38 C.F.R. §§ 14.626-14.637.
[5] For instance, if the claim is denied or claimant believes he or
she is entitled to a higher level of disability compensation.
[6] VA officials told us they do not have any documented policy or
guidance for reviewing applications for accreditation, beyond what is
in regulations. In lieu of documented guidance, GAO considered
officials' statements made during interviews describing VA's
procedures for reviewing applications, and making accreditation
decisions as criteria for our review.
[7] Because VA relies on VSOs to certify that their representatives
meet requirements for representing veterans, VA's review of
accreditation applications and related decisions mostly pertains to
attorneys and agents.
[8] Based on our analysis using a 95 percent confidence interval, VA
correctly followed its procedures for 88 to 98 percent of attorney and
agent applications approved in 2012. In the remaining cases, there was
no evidence in the application file that VA conducted needed follow-up
or we were not able to make an assessment because of missing
documentation.
[9] For four of these individuals, VA received complaints alleging
these same individuals charged non-allowable fees for filing claims.
Of the 21 individuals we conducted background checks on, 10 of them
had complaints against them on file with VA. The remaining 11
individuals were selected from our sample of 92 attorneys and agents
accredited in 2012. We were able to obtain information on 20 of the 21
individuals in our sample.
[10] The standards for internal control emphasize the need for
agencies to have relevant and reliable information relating to
external as well as internal events, in order to run and control
operations. To support agencies' efforts to obtain information, the
internal controls specifically state that operational information
should be provided to managers so that they may determine whether
their programs comply with applicable laws and regulations. See GAO,
Internal Control Management and Evaluation Tool, [hyperlink,
http://www.gao.gov/products/GAO-01-1008G] (Washington, D.C.: August
2001) and GAO, Standards for Internal Control in the Federal
Government, [hyperlink,
http://www.gao.gov/products/GAO/AIMD-00-21.3.1] (Washington, D.C.:
November 1999).
[11] GAO, Social Security Disability: Additional Outreach and
Collaboration on Sharing Medical Records Would Improve Wounded
Warriors' Access to Benefits, [hyperlink,
http://www.gao.gov/products/GAO-09-762] (Washington, D.C.: Sept. 16,
2009).
[12] VA requires a signed declaration of representation designating
the representative on VA Form 21-22 or 21-22a before an individual can
represent a claimant.
[13] VA's regulations clearly indicate that OGC will accept credible
written information from any source indicating improper conduct or
incompetence on the part of representatives of any kind.
[14] In this same time period, VA estimates that 17 VSO
representatives lost their accreditation for breaking program rules
and 3 were suspended. Officials told us that VSOs may request that VA
cancel accreditation for their representatives based on their own
information regarding the individual's behavior. Many more individuals
have their accreditation canceled for reasons not related to conduct.
VA estimates that 1,387 VSO representatives, 15 attorneys, and 1 agent
had their accreditation canceled for reasons not related to conduct in
fiscal year 2012.
[15] VA pension benefits are intended to provide economic benefits to
low-income veterans who served during a time of war, and to qualify,
veterans must have income and assets below a certain threshold. Our
prior work found instances of companies advertising financial planning
services to veterans that circumvented eligibility requirements such
as by placing assets in trusts or transferring them to family members.
See [hyperlink, http://www.gao.gov/products/GAO-12-540].
[16] We decided to not review accreditation decisions for Veterans'
Service Organization representatives since VA officials told us that
they generally rely on the recommendation of the organizations when
approving these applications.
[17] We found incomplete documentation or missing documents in 3 of
the 92 files selected. In these cases, we were not able to determine
whether VA carried out its procedures.
[18] Our search did not find results for 1 individual, so we reported
on findings for the remaining 20 in our report.
[End of section]
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